Walter Seymour Skinner is a Sergeant in the U.S. Army, the son of Sheldon and Agnes Skinner. He dreamed of becoming principal of Springfield Elementary School, which he frequently told to the men under his command. After being captured by the enemy in Vietnam, he spent five years in a POW camp, before being sold to a shoe-producing company in China, finally being released when the United Nations shut the sweatshop down. He then returned to Springfield, where he tried to take his life back, only to discover that one of the men who had once served in his unit, Armin Tamzarian, had moved to Springfield and assumed the identity of Seymour Skinner, to the point of living in his old house with his mother and even working in his dream job as the principal of Springfield Elementary.
Differences between the two Skinners
Sergeant Skinner is the real Seymour Skinner - Springfield Elementary's principal is actually named Armin Tamzarian. The real Skinner and Armin Tamzarian were buddies in the Vietnam War. Seymour Skinner took Tamzarian under his wing and turned him from a rebel into a responsible adult. Skinner would later disappear on a mission. Tamzarian, assuming Skinner was dead, decided to report the death to Skinner's mother Agnes personally. However, she thought Tamzarian was Skinner, who not wanting to sadden her, played along. It is implied that Agnes knew that Tamzarian wasn't really Seymour, but carried on with the charade so she wouldn't have to accept that her son was dead. In the end, the citizens of Springfield rode him out of town on a rail, in favor of Tamzarian, who was then legally renamed Seymour Skinner. The real Seymour Skinner has not appeared again.
All the events were forbidden from being mentioned again, under penalty of torture. The only time this rule has been broken since was when Lisa refers to Principal Skinner as "Principal Tamzarian." Also, a tombstone reading "Tamzarian" can be seen in Homer's fantasy about his own funeral in The Wizard of Evergreen Terrace.
Behind the Laughter
When Lisa called Principal Skinner "Principal Tamzarian", this was a self-referential joke, since "I, (Annoyed Grunt)-Bot" used the same plot device of making a major change to the Simpsons' world: in this case, with the death of Snowball II, then effectively erasing the change within the same episode with the appearance of Snowball V (a cat identical in appearance to Snowball II, using her old collars and name for cost purposes).